capital by karl marx.

i said i would start a thread on this when i started reading it. partly as a way to shame me into finishing it and partly cos grizzly b said he would help me with it if i found it heavy going. have you read it? did you like it?

there's been a good discussion going on my facebook wall (as Luka is already aware) which addresses some of the most common fallacies and misunderstandings -- in particular the last lengthy post by SOS, clearly articulates some crucial points in understanding Marx and Smith, and the limitations and falsehoods in our inherited state/market and other dichotomies.

thought i would post up some of the best bits:

Sos Nihon

Much of what goes under the name of Marxism -- "orthodox Marxism" or Marxist-Leninism -- are forms of state-capitalism. Some would argue (myself included) that the most interesting currents of Marxism emerged in contradistinction to this often authoritarian tradition. Harvey is useful too but the best schematic introduction I've found is Harry Cleaver's Reading Capital Politically, which has exerted a justifiable influence among autonomists all over the world:

There is one thing, that I never see addressed: How do you deal with resource management in a non-capitalistic world?
This is the one thing, that capitalism solves pretty well and communism fails in. It is extremely complex to run a system that optimizes supply and demand.
Assuming there would be a possibility to run a planned economy by a super sophisticated realtime algorithm, there would be still the problem of motivation.

Sos Nihon

Matthias, if you have followed this thread so far, what you call "planned economy" (and wrongly "communism" -- remember that even Stalinists didn't claim their social system was "communist" but a "socialist" state in transition to "communis...m", which never arrived) is, more accurately, a feature of capitalism. Historically, all forms of capitalism have required some kind of state intervention/planning (whether enclosure and destruction of indigenous land/resources, establishment of Foucauldian panopticon at the both carceral and societal levels, or, more specifically in the U.S. case, as a system of military Keyensianism) as well as market mechanisms.

As for the question of resource-management, most of non-capitalist human history until the advent of capitalism in the sixteen and seventeenth century appeared to be doing just fine, critical as some of us may be about this or that aspect of various systems that existed at the time, from seigneurial feudalism to nomadic hunter-and-gather society. In fact, given the exponentially algorithmic technological development of industrial and consumerist capitalism, tremendous wastes have been generated, as anybody who has given even a superficial glance at the global ecological crisis today know all too well -- and this "waste" is not at the microeconomic level of transactional imbalance in supply/demand within a miniscule economic sector but at the catastrophically colossal level of the world threatening all species, which surely ranks as the worst example of resource management in history. By the way, it might also be worth recalling here that the notion of "algorithm" does not originate within capitalism, as the word itself derives from the name of the medieval Persian scientist al-Khwarizmi.

Motivation: just as many Soviet workers rightly hated to work under their inefficient bureaucratic state capitalist regime, most of us in liberal capitalist societies hate to go to work at places usually under the control of a corporation that is run on essentially totalitarian principle -- I don't see how this speaks well to the motivational nature of capitalism. Plus there's a strange ideological assumption here -- that motivation toward economic development/efficiency should be an unquestionable good above all others. What if you want to live your life according to a different mode of motivation, such as the spiritual discipline of a monk or the creative expression of an artist or the moral economy of a peasant? One of capitalism's major defects is that it destroys all these various forms of human motivation under the servile dictum of "work or die". A pretty impoverished, to say nothing of repressive, form of motivation if you ask me.

Matthias Georgi

Sos: I see what you are trying to say. But still I have the feeling, that you are not offering any solution at all (going back 500 years is not a solution in my eyes). Capitalism is brutal, no question. But so was almost any society with th...eir class systems and suppression of the poor. My point is, that capitalism needs to be fixed not destroyed. Exploitation of natural resources for instance is a mistake in the design of the system. If people had to pay for what we take from nature, the system would regulate this problem by itself.

Motivation: capitalism by itself doesn't have any ideological assumptions. it's just a mechanism to deal with goods and services, not more. the point is, our current financial system has some huge flaws, that need to be fixed, for example how banks, debts and interests work. but the principle of a free market itself is a great way of dealing with supply and demand.

Leo Zhao

Matthias, i don't think SOS, or Marx or anyone is suggesting that we go "back" to anything, but only that historical evidence shows that capitalism is by far not the only, and by FAR not the best functioning system for large societies. And perhaps especially in terms of resource management capitalism performs very poortly: just one example: a staggering more than 50% of food that we produce today is wasted. The everything for profit mode has shown a complete disregard for everything else: the 5 euro winter slippers i bought which broke after a single day is a good example - a waste of materials, waste of the workers' labor, waste of the consumer's time and money, a COMPLETE waste all around, and because why? because profit is the only thing people care about.

The only people who think capitalism works live on the half of the exploiting world, ignoring and rationalizing the complete lack of human rights and pandemic, extreme suffering of the exploited other half, who endure and perish en masse under economic, political, and not least of all physical violence every day. Child laborers in S.E. Asia whose legs have atrophied and no longer able to walk due to sitting for 18 hours a day making shoes since age 4. The conflict in the Congo over mineral resources which have so far claimed 5.4 million (conservative estimate) lives in the deadliest war since WW2 (UN) does not get even mentioned in Western media, and thus is not made aware to the vast majority of first world citizens. Consider hundreds of children hacked to pieces with machetes and thrown into the river, because they live in an area with minerals and diamonds, and talk to me about "resource management".

The problems are entirely foundational, elemental, structural, resides in the basic ideological premises of the capitalist system itself, and can never be fixed by adjusting this or that policy. Perhaps the most pernicious trick of all is capitalism makes itself seem neutral, and makes its ideology seem "natural" and thus invisible. But oh yes there is ideology (just a couple of examples due to time constraints):

The false exultation of competition over cooperation, so deeply ingrained as to cloud and distort the thinking of even evolutionary biologists such as Darwin, has been largely accepted by most today as "natural"; while in actual nature it is Symbiosis and Cooperation which is the driving factor behind evolution, not Competition (ask Lynn Marguilis).

The "free market" has always been a fiction in practical terms; in reality no such thing exists. Hereditary aristocracy makes sure that those born into the 1% will always have the vast majority of opportunities, power, human rights, while the rest of the first world have very little, and the rest of the world have none. So the Big Lie of "pulling one self up by bootstraps" is just that, a Big Lie, to the vast majority, regardless of how many exceptional examples are endlessly touted.

The idea that material possessions make us happy creates both waste and misery for all parties involved. the ideology of personal satisfaction and individual achievement at the expense of everyone else...

Not only capitalism, but also the ideological bedrock on which capitalism is built, needs to be completely dismantled, soon because we are about to face the disastrous consequences of capitalism, yes even we who live in the first world. The only other perspective is that it is too late, that we have already entered a new dark age of wide spread economic, political, environmental catastrophes on a global scale.

Matthias Georgi
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Leo Zhao: Sorry, I don't have time for a lengthy response. It's totally true, people are doing bad and horrible things for profit. In my eyes it is too easy to say it is the fault of capitalism. Not capitalism is bad, it is the human nature. It is greed for power. It can happen in any system. And again what system should replace capitalism?
Regarding resource management, if a system produces a lot of waste, it still can handle supply and demand efficiently. We have a lot of waste, because we produce so much. Apart from the negatives things you said, it shows us one good thing: we could easily live without unemployment and poverty.

Well. First of all, without having tried to read through the Kapital, I think that Marxism encompasses a political system if it is supposed to be anything but a Utopian story, as it is based on a special category of rights and whatnot. Seco...ndly, if I am informed correctly, Socialism is a necessary stage towards Communism (which was thought to emerge quite a long time after Socialism which is paving the way) and though not seen as an optimal system, I think that Marx and Engels did envision it something like it turned out in the end. Perhaps they didn't think it was quite that brutal and definitely not such a complete failure. However, the way the Socialist countries behaved was eventually inevitable given that the economic system is based on force.

On the economic aspects of Socialism/Communism – first of all, Marx failed (like al the Classical economists) to resolve the price issue. But without prices, a proper allocation of goods is a very difficult thing to do. And just producing anything you feel like will most likely lead to a very big catastrophe very soon. I think that it is not coincidental that a black market, which determined the price of goods following demand and supply, was alway flourishing in Socialist societies, and that Lenin saved his project by a reverting to several Capitalist reforms after the awesome War Communism had such great success.

True enough, the 19th century factories might not have been the most awesome places to work in, but on the one hand, I am not so sure if it was so much better before, and then you have to take into consideration that it was a revolution in society coupled with an incredible explosion, so it is eventually a wonder that everyone even got fed after the population was more or less unstable for hundreds of years due to a lack of food. And now, in the developed world, living standard has quite improved.

As for the thought that Socialism just sucked because the Soviet Union was a feudalistic country before – Japan, for example, was an isolated, feudalistic country for just about as long and they managed to become one of the world's greatest economies under Capitalism. Also, Western and Eastern Germany started out roughly the same, yet the West thrived under Capitalism while the East had to build a wall to stop the people from fleeing.

And then the necessity of the State. The State is essentially Anti-Capitalist and in no way needed in a Capitalist society. It is, furthermore, the intruder that causes most of the problems we see today, especially the disrespect of property rights (like lately in the Amazonas region, were for „the greater good“ or whatever they decided just to flood Indian communities), warmongering, colonialism, genetic technology, atomic energy, and so on. While some might pretend they are Capitalists, it's quite ridiculous to say for, say, a banker who works with money which is a 100% government controlled commodity nowadays. Free markets can exist, but naturally not if the state takes part in the economy with 50 to 75 %, as it does now in most societies of the First World. Socialism, on the other hand, depends on the totalitarian state, as the system is not based on voluntary cooperation and the natural rights of every human being, but arbitrary allocation of everything.

Bobby Bisto

do you really think the free market is an infalliable way to distribute commodities? do you even beleive the government controls money
what are the downsides of a 'free market' for healthcare services to give an obvious example? why where there massive food riots in 2008?
was it to do with state intervention?

Bobby: There is a state monopoly on money (you have to accept legal tender as money and are not allowed to use other stuff) with central banks determining both the amount of money they offer, the amount banks need to keep as reserve when creating credit from nothing and the interest rates for which money sells - seems a lot like the state controls the money.

Matthias: A real free market is in no way a hindrance to the emergence to alternative or parallel systems, so yeah, you can have pretty much anything you like with them (as long as it is based on voluntary cooperation). That's also the mayor difference with state controlled systems (like the economic system we have today or the failed socialist experiments), which cannot allow any alternative to the status quo.

Bobby Bisto

central banks are not synomous with the state.
not all of them are independent but many are. that doesnt mean the state has no input but it does mean they are not synonomous with the state. nor does the state have direct control over the value of the national currency.
Bobby Bisto nor does the state determine the amount of liquidity in the economy. it tries to influence all these things but to say it controls money is an enormous overstatement.

Matthias: Leo is right -- never did I argue that the solution was to go back to different social formations antedating capitalism (although it might be worth noting that, with all their obvious limitations, primitivists have a point when th...ey argue that some hunter-and-gather societies enjoy far more leisure and less class oppression/exploitive labor than modern industrial societies, as Marshall Sahlins empirically adumbrated in Stone Age Economics, what Leo referred to as "original affluence"). In fact, take a look at the Jameson quote that initiated this thread: utilizing automation and computerization that capitalism developed in order to go beyond it (this idea derives from Marx's "Fragment on the Machine" in his unfinished mss. Grundrisse). This is a very classical Marxist understanding, running from Marx through Marcuse -- namely that capitalism, and its class protagonist, the bourgeoisie, are so far the most revolutionary system/class in history. If you actually read The Communist Manifesto, you’ll notice that the document should be retitled The Capitalist Manifesto, given its effusively ecstatic description of how capitalism revolutionizes and destroys all feudal relationships. You should be aware of the historical context: in 1844, the year of the Manifesto's composition and on the verge of a continental revolution (which the sociologist Mike Davis recently compared to the Arab Spring), most of Europe was still monarchical, its economic system overwhelmingly rural and feudal, and state institutions repressive and, if you like, totalitarian (Marx was run out of Prussia because he was an editor of a democratic newspaper Rheinische Zeitung calling for, among other things, freedom of speech). So given that the classical Marxist presupposition is that you take this revolutionary modern economic system of capitalism as the basis for a new post-capitalist society, all the objections put forward here on the basis of pitting the rational market to the repressive state are absolutely moot (also, for Marx’s later views on how you go from rural traditional society to a radical democratic one in Russia, see his letters to Vera Zasulich, in which he argued AGAINST the Russian Marxists).

Also, re: human nature as the source of greed and exploitation, and not capitalism -- as Marx stated explicitly in the preface to the first edition of Capital, his analysis does not blame individual capitalists for injustices and inequalities developed under capitalism but seeks to understand capitalism as part of "natural history". In other words, Marx sought to analyze capitalism partly as an expression of human nature -- which it no doubt is, at least one variant among many, just as all social formations are (btw, this is very different from naturalizing capitalism as a singular, teleological path of human history, for that’s precisely the kind of self-serving ideological rationalization he was critiquing, but to see how capitalism accentuates certain aspects of human nature, such as greed in the form of fetishizing profit via imposition of alienated labor), thus his point was not to condemn it as bad or praise it as good but to understand it as a historical system on its own terms, with a specific origin, lifespan, and terminus (as opposed to market capitalist ideologues who think a la Candide that this is the "best of all possible worlds" and that the market is an eternal principle in the same way that God was viewed as such by the feudal priesthood).

There’s a good reason why Marx doesn’t offer ready-made alternatives to capitalism (at most there are only a few paragraphs about what communism is in Marx’s entire work). Many nineteenth-century socialists during Marx's time tried to creat...e alternatives to industrial capitalism -- Robert Owens, an industrial capitalist in his own right, and Charles Fourier are probably the most famous examples -- but, interesting as their efforts were, they never lasted because real societies don't emerge out of such social-engineering castle-building in the air. Hence Marx's critique of the utopian socialists, which can be extended to those who offer state ownership or the market as an utopian solution to the problems of our economic system. Instead, Marx stressed the importance of diagnosing what's actually going on, figuring out alternatives from what people are doing instead of imposing utopian blueprints. And there are plenty of really-existing alternatives, from Kerala and Mandragon to traditional subsistence economies to what we ourselves do with people in relation to our hobbies, passions, and creative impulses outside the circuits of capitalist reproduction, although we may not give it any name and don't think much of it. There are also historical examples too numerous to mention, from the Diggers during the English Revolution to the workers’ councils in their various permutations throughout the twentieth-century revolutions. You might say this or that is going to work or doesn't work in the abstract, as if the world is the vacuum of an academic seminar, but the world never works in a vacuum. For example, the installation of “free market principle” has been almost always executed with state violence, as you can see in Chile under Pinochet, who took advice from the eminent Chicago-School free-market economist Milton Friedman, and even attempts at liberal democratic capitalism have called forth repeated CIA-backed military coups (as in Guatemala under Arbenz, Iran under Mosaddegh, etc.).

RE: the efficiency of the market, my suggestion is go back to its preeminent theoretical advocate Adam Smith and read what he actually says. His theory of the market stipulates that it would produce equality of conditions -- as opposed to just opportunities -- so if such conditions cannot be produced by the market we can reject it as insufficient on the very ground that it can’t even meet the requirements of its most classical formulation. Also, it’s worthwhile to recall that capitalism makes itself possible only on the basis of destroying the market in its original historical sense, which was a place of exchange at the periphery of subsistent, largely peasant economies (cf. Fernand Braudel’s historical trilogy on Capitalism and Civilization) -- so if you really believe in the market as a vehicle of meeting human needs, you’d have to oppose the financial market and its interlocking system of exchange which, like the corporations, are by definition anti-democratic institutions. Read Karl Polyani’s The Great Transformation, a classic account of how nineteenth British market capitalists took seriously their utopian dogma about the market and, when they put it to practice, ended up generating desolation in their society. What is so ironic is that, after the disintegration of the Soviet Union, many anticommunist ideologues claimed that the utopianism on the part of the socialists resulted in the economically moribund gulag state while they themselves offered a no less utopian panacea in the form of market fundamentalism, which is one of the primary roots of our present financial crisis. If you think about it, this market fundamentalism, touted among devotees of the empirically bankrupt (and really silly tautologies dressed up as serious intellectual discourse) ideas of Ayn Rand, Robert Nozick, and the Chicago School economics, is a mirror-image of the state socialist fundamentalism that claimed it as a “workers’ paradise”, except that the latter totalitarian practitioners in the Soviet Union managed to provide a relatively higher standard of living than what prevails today in greater Russia, with complete breakdown in the social and healthcare system, gangster capitalism entrenched through the mafia-dominated informal sector, and a corrupt, nominally parliamentary state not above outright assassinations of dissidents. Which of course isn’t an argument to go back to the repressive Soviet state but it speaks to the principle of “plus ça change, plus c'est la même chose" when your only point of reference is the impoverished dichotomy of state/market (a residual cliché of Cold War invention, which conceals the structural corollary between state socialism and corporate capitalism as being both based on enclosure of the commons and imposition of alienated labor on mass industrial scale) and to the aforementioned necessity of taking into consideration how the real world works, as opposed to offering facile, universal solution in the form of the market or anything else.

Eliazar mentioned not having read Marx. I think it would greatly benefit our discussion if we base our arguments on actual readings -- not just of Marx but Smith, Ricardo, et al. -- and real-world examples.

but only that historical evidence shows that capitalism is by far not the only, and by FAR not the best functioning system for large societies. And perhaps especially in terms of resource management capitalism performs very poortly

facts counter to what i've said? i think others who say capitalism is like, TEH BESTEST EVAR, have, or attempted to at least, put up many examples supporting that

no, really. i'm not going to pretend to be anything but the novice that i am. so here is SOS again:

most of non-capitalist human history until the advent of capitalism in the sixteen and seventeenth century appeared to be doing just fine, critical as some of us may be about this or that aspect of various systems that existed at the time, from seigneurial feudalism to nomadic hunter-and-gather society. In fact, given the exponentially algorithmic technological development of industrial and consumerist capitalism, tremendous wastes have been generated, as anybody who has given even a superficial glance at the global ecological crisis today know all too well -- and this "waste" is not at the microeconomic level of transactional imbalance in supply/demand within a miniscule economic sector but at the catastrophically colossal level of the world threatening all species, which surely ranks as the worst example of resource management in history. By the way, it might also be worth recalling here that the notion of "algorithm" does not originate within capitalism, as the word itself derives from the name of the medieval Persian scientist al-Khwarizmi.

Marx stressed the importance of diagnosing what's actually going on, figuring out alternatives from what people are doing instead of imposing utopian blueprints. And there are plenty of really-existing alternatives, from Kerala and Mandragon to traditional subsistence economies to what we ourselves do with people in relation to our hobbies, passions, and creative impulses outside the circuits of capitalist production, although we may not give it any name and don't think much of it. There are also historical examples too numerous to mention, from the Diggers during the English Revolution to the workers’ councils in their various permutations throughout the twentieth-century revolutions.

Of course there's no denying that capitalist economies - both the traditional free-market kind and the state-capitalist kind - tend to consume resources at an unsustainable rate. But it's important to avoid noble-savage-type fantasies about indigenous people living in perfect harmony with Mother Nature. This may be the case for some pre-technological societies but certainly not for others - you only have to look at the effect the Maori had on New Zealand's biodiversity long before the first Europeans turned up. Similar pre-modern extinctions are thought to have happened in other parts of the world, too.

The big differences with technological societies is the overall far greater population density and the fact that it's much more efficient to hunt things with guns than with spears or bows.

Not that technology is synonymous with capitalism but the technologies that we see as forming the basis of modern world since the industrial revolution have generally sprung from capitalist societies.

Yeah, think the problem with capitalism is how to stop it driving people into a mad orgy of wanting more, more, more, and simultaneously neglecting the needs of others with less advantageous backgrounds, loss of empathy etc.

Am currently reading an interesting article about tensions between democracy and capitalism in the post-war period.

Yeah, think the problem with capitalism is how to stop it driving people into a mad orgy of wanting more, more, more, and simultaneously neglecting the needs of others with less advantageous backgrounds, loss of empathy etc.

Am currently reading an interesting article about tensions between democracy and capitalism in the post-war period.